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NRP Round Trip

mikorizal
April 13, 2015

NRP Round Trip

The whole cycle from Order to Production to Income Distribution according to the Value Equation

mikorizal

April 13, 2015
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  1. NRP Round Trip
    Example of a Cycle
    from Order to Production
    to Income Distribution
    http://mikorizal.org

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  2. This round trip includes:
    ● Order from a customer, which creates a plan based on a recipe
    ● Purchasing inputs that won’t be made by the group
    ● Making what was ordered, based on the plan, and coordinating P2P
    ● Shipping or delivering the products
    ● Receiving payment for the products
    ● Distributing the income received to people who contributed, using a
    democratically decided value equation

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  3. First an order is received...
    It also could be that the group has decided to create something without a customer order, for example
    some tools they need.
    Or some groups usually make to inventory. For example, if the tomatoes are ripe, it is time to make a
    large batch of salsa, which will be sold or traded after it is made. We call this a work order instead of a
    customer order.
    In this example it is a
    customer order for a
    3D printed part. This
    group usually makes
    to order because
    each order for 3D
    printed parts is
    different.

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  4. The order generates a plan based on the recipe...
    If there is a recipe for the product that was
    ordered, it is used to generate a plan.
    This plan has one order item, with two
    processes planned to create the product.
    The process to print the part is dependent
    on completion of the design.
    Some recipes are very exact, when the
    manufacturing information is known.
    Some are more general.
    In either case, the plan can always be
    changed to fit the circumstances, either by
    changing the details, or re-scheduling a set
    of dependent processes forward.

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  5. Here is the resource flow for creating the product...

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  6. Any inputs that won’t be created are purchased...
    Required inputs can be purchased by the group or by individuals, who will get credit for this as a
    contribution. This is the logged purchase of the polymer consumed to make the part, paid for by a
    member of the group. It is now in inventory. Some will be used for this part and some for other work
    in the future. If an input is already in inventory, purchasing it will not be planned.

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  7. The 3D printer that was used for this work was
    purchased through cash contributions by two
    people in this simple example. In the real
    Sensorica case, it was many more.
    The contributors get paid back over time as the
    printer makes money. All of the resource and
    cash flows are transparent to everybody. When
    everyone is paid back, the printer will become
    part of the commons.
    The community funded a piece of equipment...

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  8. The product is created...
    Here the part is being made. All the
    inputs are logged transparently.
    People can coordinate their work
    through views and notifications.
    The group can decide whether to log
    work contributions for credit, or to give
    credit for the deliverables without
    logging the hours of work.
    Each output is logged too. If an output
    of this process is needed for the next
    process, it is now available.
    Some resources are consumed by the
    process and no longer visible in
    inventory. Others, like equipment, are
    merely used.
    Inputs like designs or ideas can be
    cited so the creators get credit for their
    contributions to those inputs.

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  9. The product is shipped and payment received...
    When the product is shipped or delivered, that is logged, and it goes out of inventory.
    When the payment is received, it is also logged. Payment could be in a standard currency or a
    crypto-currency or some other resource.

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  10. Here is how the income gets distributed...

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  11. As you can see here, it cost the network €185.63 to make the printed part...
    ...but they sold it to
    the customer for
    €250.
    In a normal business,
    the surplus would go
    to the business
    owner.
    But in a value
    network, it is shared
    by the contributors.

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  12. The group has agreed upon a value equation...
    Here is the value equation agreed
    upon by this fictitious team.
    In this example, a percentage is
    set aside for fixed lab costs, and
    also a percentage for people who
    do support work for the network in
    general. The rest goes to the
    people who produced the product
    that was sold, based on their work
    and financial contributions.
    Another network might split by
    percentage by work function, for
    example growing, harvesting, and
    drying herbs. Or translating,
    editing, publishing a translated
    work based on word count. These
    examples use deliverables rather
    than time as contributions.

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  13. Here are the details when the value equation is run...
    This gives an explanation of how the distribution will be created for this order for the 3D printed part. It
    allows people to experiment with defining their value equations, and see how things will work before
    agreeing on the rules and actually distributing income.

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  14. And here is the final distribution for this work...
    Here are the aggregated results of
    this value equation’s rules applied
    to the work and financial
    contributions made by the group,
    both to fulfill the order and to
    support the production work.
    Everyone’s contributions were
    traced back through the value flow
    so everyone can get rewarded.
    A final note: The functions and options that the software supports were created to fit the
    needs of the networks that have used the NRP thus far. As others start using the software,
    we are sure that more ideas will be introduced. We will be happy to continue to refine the
    software to fit the needs of other networks.
    The Mikorizal team

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